Resona : Financial Highlights for 1Q of FY2021

Financial Highlights for

the First Quarter of Fiscal Year 2021

July 30, 2021

Outline of Financial Results for the 1Q of FY2021

• Net income attributable to owners of parent: JPY34.2 bn
• • Up JPY12.4 bn, or 56.8%, YoY
  • Progress rate against the full year target *1 : 23.6%
• Actual net operating profit: JPY45.1 bn
  Down JPY6.5 bn, or 12.7%, YoY
• • Gross operating profit: JPY148.9 bn Down JPY5.6 bn, or 3.6%, YoY
  • • Net interest income from domestic loans and deposits: Up JPY0.7 bn, YoY

Average loan balance : +4.79%, YoY

Loans rate : down by 3bps, YoY

[Excluding loans to the Japanese government and others] Average loan balance : +2.78%, YoY

Loans rate : down by 1bps, YoY

Both loans balance and loans rate were in line with the plan.

 Fee income : Up JPY6.6 bn, YoY Fee income ratio : 33.9%

Increased driven by growth in asset formation support business and settlement-related.

• •  Net gains on bonds (including futures) : Down JPY16.0 bn, YoY

  • Operating expenses: JPY103.8 bn, Increased by JPY0.7 bn, YoY
    In line with the plan, KMFG kept reducing operating expenses.
• Credit related expenses: JPY7.1 bn (cost)
  Decreased by JPY8.7 bn, YoY

Improved YoY, having posted 16.3% against full year guidance.

• Share buyback and cancellation of treasury stock
• • Completion of share buyback to neutralize dilutive effect on EPS from making KMFG a wholly-owned subsidiary of HD
    (June 11: 88 million shares/ JPY40.9 bn)
  • • Cancellation of treasury stock is scheduled on August 10.
• Established long-term sustainability targets

						FY2021
				HD consolidated		YoY change	Progress rate
					1Q
				(JPY bn)				v s. Target*1
							%
						(a)	(b)	(c)	(d)
Net income attributable to	(1)	34.2	+12.4	+56.8%	23.6%
owners of parent
EPS (yen)	(2)	13.88	+4.39	+46.2%
BPS (yen)	(3)	1,034.69	+93.15	+9.8%
	Gross operating profit	(4)	148.9	(5.6)	(3.6)%
		Net interest income	(5)	103.7	+3.7
			NII from loans and deposits*2	(6)	84.8	+0.7
		Fee income	(7)	50.6	+6.6
				Fee income ratio	(8)	33.9%	+5.5%
			Trust fees	(9)	4.9	+0.4
			Fees and commission	(10)	45.6	+6.2
			income
		Other operating income	(11)	(5.4)	(16.1)
			Net gains on bonds	(12)	(8.2)	(16.0)
			(including futures)
		Operating expenses (excluding group	(13)	(103.8)	(0.7)	(0.7)%
	banks' non-recurring items)
				Cost income ratio (OHR)	(14)	69.7%	+3.0%
	Actual net operating profit	(15)	45.1	(6.5)	(12.7)%
	Net gains on stocks	(16)	13.9	+14.8
	(including equity derivatives)
	Credit related expenses, net	(17)	(7.1)	+8.7
	Other gains, net	(18)	(2.8)	(0.0)
	Net income before income taxes	(19)	49.0	+17.0	+53.1%
	and non-controlling interests
	Income taxes and other	(20)	(14.8)	(5.9)
	Net income attributable to	(21)	(0.0)	+1.2
	non-controlling interests

*1.	Full year target of FY2021: JPY145.0 bn
*2.	Total of non-consolidated domestic banking accounts of group banks, deposits include NCDs	1
*3.	Negative figures represent items that would reduce net income

Updates on Business under the COVID-19 Pandemic

• Fulfilling our mission as a social infrastructure under the COVID-19 pandemic

Local	 Continuously offering our full-line banking services
 Expansion of digital channels such as Resona
communities
and	Group App etc.
 Providing solutions to the changing issues
Customers
	customers confront

Employees

Society

• Promote diverse working styles such as remote work etc.
• Workplace vaccinations (from July '21)
• Contributing to the local communities through engagement in business and social contribution activities

• Provide our valuable financial services to customers facing issues in a changed environment

1Q of FY2021: Both loans balance and loans rate were in line with the plan.

Fee Income have increased by 15.2%, YoY, driven by growth in investment trust, fund wrap and settlement-related. New bankruptcy in specific reserve was at a low level. Credit costs have posted 16.3% against the full year guidance.

Change in customers' issues

Stable funding Strengthen financial base

Changes in lifestyle norms Acceleration of digitalization

Growing awareness of

preparedness Review future plans

Updates on major businesses in 1Q

• Loans and capital finance support for corporate customers
• • COVID-19related loan origination*1: JPY4.0 trillion
  • Support business growth and turnaround by utilizing capital support fund etc.
• Non face-to-face and cashless transactions
• • Resona Group App: 4 million downloads, up 1.39 million, YoY
  • # of debit card issued: 2.55 million, up 0.43 million, YoY
• Asset formation support
• • Balance of fund wrap (including corporation*2): JPY608.3 bn, up 45.7%, YoY
  • iDeCo participants: 140 thousand, up 15.1%, YoY
• Asset and business succession
• • # of new asset succession-related contracts: 1,828, 2.2 times, YoY

*1.	Cumulative total based on reporting from four group banks from Mar. 10, '20 to Jun. 30, '21	2
*2.	Including balance of fund wrap in banks other than group banks

For the Creation of a Sustainable Society

Aim to become the most significant contributor to retail customers' success in SX*1

• Overview of Resona Group's SX

Our recognition	Sustainable		Resona's
of the business environment	Resonance	sustainable
The accelerating trend toward SX	society		growth
	Our role	Achieve our vision
	Our vision	Local communities' SX
Commitment			Long-Term
(RSC2030)			Sustainability Targets
Sustainability activities to accelerate efforts	Customers' SX

• Long-termsustainability targets

1. Retail Transition Finance

Cumulative total of JPY10 trillion

(FY2021 to FY2030)

Financing coverage:

Financing*2 aimed at helping retail customers update their awareness, transform their modes of behavior and stably move forward from their current situation

Established in June '21

2. Carbon Neutrality

Net zero CO2 emissions (By the end of FY2030, Scope 1 & 2)

Reduce CO2 emissions attributable to energy used by the Group to Net Zero by the end of FY2030 via the proactive switchover to renewable energy

3. Empowerment and Promotion of Women

10% or greater growth in the ratio

of women in various senior

positions from the current levels (By the end of FY2030)

Ratio of female directors and executive officers*3: 30% or more

Ratio of female senior managers*4: 20% or more

Ratio of female line managers*4: 40% or more

*1. Sustainability Transformation *2. Including financing for such green projects as renewable energy generation, as well as large corporate	3
financing involving third-party verification *3. HD *4. Sum of six group companies (HD, RB, SR, KMFG, KMB and MB)

Breakdown of Financial Results

					Resona Holdings		Total of group banks																Difference
			(JPY bn)		(Consolidated)			Resona			Saitama		Total of
												group
													Resona
						YoY				YoY		Bank		YoY	Bank			YoY	banks under			YoY
														KMFG
					(a)	(b)		(c)		(d)		(e)		(f)	(g)		(h)		(i)			(j)		(a)-(c)
Gross operating profit	(1)	148.9	(5.6)		134.6		(6.3)			71.7		(9.5)	28.8			+0.2		34.0			+2.9		14.3
	Net interest income	(2)	103.7	+3.7		101.9		+3.6			54.7		+3.4	21.2			+0.6		25.8			(0.5)		1.8
			NII from domestic loans and deposits	(3)				84.8		+0.7			43.6		+0.9	17.3			(0.1)		23.7			(0.1)
			Gains/(losses) on cancellation of investment trusts	(4)	0.1	(1.5)		0.1		(1.0)		*1	－		+0.4	0.0			(0.6)		0.0			(0.8)		0.0
	Fee income	(5)	50.6	+6.6		38.4		+6.0			23.8		+2.2	7.8			+0.7		6.7			+3.0		12.1
			Fee income ratio	(6)	33.9%	+5.5%		28.5%		+5.5%			33.1%		+6.6%	27.2%			+2.3%		19.9%			+7.9%
		Trust fees	(7)	4.9	+0.4		4.9		+0.4			4.9		+0.4	0.0			+0.0		－			－		(0.0)
		Fees and commission income	(8)	45.6	+6.2		33.5		+5.5			18.8		+1.7	7.8			+0.7		6.7			+3.0		12.1
	Other operating income	(9)	(5.4)	(16.1)		(5.7)		(16.0)			(6.8)		(15.2)	(0.2)			(1.1)		1.3			+0.3		0.3
			Net gains on bonds (including futures)	(10)	(8.2)	(16.0)		(8.2)		(16.0)		*1	(8.6)		(15.2)	(0.5)			(1.1)		0.8			+0.4		0.0
Operating expenses	(11)	(103.8)	(0.7)		(97.3)		(0.4)			(52.5)		(0.9)	(19.1)			(0.4)	*2	(25.6)			+1.0		(6.5)
(excluding group banks' non-recurring items)
			Cost income ratio (OHR)	(12)	69.7%	+3.0%		72.2%		+3.5%			73.1%		+9.7%	66.2%			+1.1%		75.4%			(10.4)%
Actual net operating profit	(13)	45.1	(6.5)		37.3		(6.7)			19.2		(10.4)	9.7			(0.2)		8.3			+3.9		7.8
Core net operating profit *3	(14)				43.9		+8.0			26.6		+2.3	9.9			+1.3		7.3			+4.3
(excluding gains/(losses) on cancellation of investment trusts)
Net gains on stocks (including equity derivatives)	(15)	13.9	+14.8		13.6		+12.9			11.0		+12.8	2.3			+1.1		0.2			(1.0)		0.2
Credit related expenses, net	(16)	(7.1)	+8.7		(6.8)		+7.5			(6.2)		+5.1	0.2			+1.0		(0.8)			+1.3		(0.3)
Other gains/(losses), net	(17)	(2.8)	(0.0)		(2.5)		(0.0)			(1.3)		+0.3	(0.3)			+0.4		(0.7)			(0.9)		(0.2)
Net income before income taxes	(18)	49.0	+17.0		41.6		+13.6			22.6		+7.8	11.9			+2.3		7.0			+3.3		7.4
Income taxes and other	(19)	(14.8)	(5.9)		(12.3)		(4.7)			(6.7)		(2.8)	(3.4)			(0.6)		(2.1)			(1.1)
Net income attributable to non-controlling interests	(20)	(0.0)	+1.2
Net income	(21)	34.2	+12.4		29.3		+8.8			15.9		+4.9	8.4			+1.6		4.8			+2.2
(attributable to owners of parent)
	*1. Losses on cancellation of investment trusts are posted in the net gains on bonds since net of the losses and dividends from investment trusts become negative
			(Losses on cancellation of investment trusts: JPY(5.9) bn, dividends from investment trusts: +JPY0.6 bn →	net amount: JPY(5.3) bn)
	*2. Exclude goodwill amortization by KMB, JPY(0.1) bn, related to acquisition of former Biwako Bank																4
	*3. Actual net operating profit - Gains on cancellation of investment trusts - Net gains on bonds